Hilborn et al v. Metropolitan Group Property and Casualty Insurance Company

Filing 67

MEMORANDUM DECISION AND ORDER Plaintiff's Motion for Partial Summary Judgment 47 is Denied. Plaintiff's Motion to Strike is Deemed Moot. Defendant shall provide the Hilborns with all the documents listed in the privilege log submitted to this Court. Signed by Judge B. Lynn Winmill. (jp)

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF IDAHO
ROBERT W. HILBORN AND JEAN
ANNE S. HILBORN,

Case No. 2:12-cv-00636-BLW
MEMORANDUM DECISION AND
ORDER

Plaintiffs,
v.
METROPOLITAN GROUP PROPERTY
AND CASUALTY INSURANCE CO.,
Defendant.

INTRODUCTION
The Court has before it the Hilborns’ Motion for Partial Summary Judgment (Dkt.
47) as well as their Motion to Strike (Dkt. 40). The Court heard oral argument on these
two motions, as well as Defendant’s Motion for Partial Summary Judgment (Dkt. 24), on
January 14, 2014. The Court denied Defendant’s motion at the hearing, and took the
other two motions under advisement. For the reasons expressed below, the Court will
now deny Plaintiffs’ Motion for Partial Summary Judgment, and deem moot the Motion
to Strike. The Court will also address the documents provided to the Court for privilege
review pursuant to the Court’s earlier Order (Dkt. 50).

MEMORANDUM DECISION AND ORDER - 1

BACKGROUND
This case arises out of an insurance claim on a residential property that was
destroyed by a fire. The Hilborns allege two counts in their Complaint. In Count I, they
claim that Metropolitan denied part of their homeowners insurance in bad faith after they
lost their house to the fire. In Count II, they claim that Metropolitan breached its contract
with the Hilborns by denying their homeowners insurance claim.
The Hilborns home burned down on September 24, 2011. Statement Material
Facts ¶2, Dkt. 42. It is undisputed that the home was insured by Metropolitan. Id at ¶1.
The Hilborns’ daughter, Kimberly Atchison, was the only person home at the time of the
fire. Reist Decl. ¶2, Dkt. 29. Plaintiff Robert was in Salt Lake City and Plaintiff Jean
Anne Hilborn was in Spokane, Washington. Id. at ¶3. The loss was reported to
Metropolitan on September 25, 2011, by Jean Anne Hilborn. Id.
Metropolitan started their investigation of the fire in early October. Statement of
Material Facts at 2, Dkt. 27. Metropolitan hired two different "cause and origin" experts
to investigate the cause of the fire. Statement of Material Facts at ¶10, Dkt. 42.The first
investigator was Glenn Johnson, and the second was Shane Hartgrove. Id. Neither
investigator was able to determine the cause of the fire. Id. However, the second
investigator, Hartgrove, did believe that there was evidence that the fire was intentionally
set. Statement of Material Facts at 4, Dkt. 27.
At the request of Metropolitan, Jean Anne Hilborn submitted a personal property
inventory (a list containing all of the household items that the Hilborns claimed were

MEMORANDUM DECISION AND ORDER - 2

destroyed as well as the value of each item). Statement of Material Facts at ¶12, Dkt. 42.
After Metropolitan took examinations under oath of Robert Hilborn, Jean Anne Hilborn,
and Kimberly Atchison, it denied the Hilborns’ insurance claim. Thenell Decl. at 4, Dkt.
32-8. Metropolitan’s basis was that Kimberly Atchison “and/or” Jean Anne Hilborn had
caused the fire in question and that material misrepresentations had been made regarding
personal property losses sustained in the fire. Id.
Metropolitan moved for partial summary judgment on the bad faith claim (Dkt.
24), which this Court denied in a ruling from the bench on January14, 2014.
The Hilborns now ask this Court to grant partial summary judgment as to Robert
Hilborn’s breach of contract claim.1 In support of this motion, they assert that the facts
are clear that Robert Hilborn is an innocent coinsured, and therefore he should be
awarded the insurance proceeds.
Additionally, the Hilborns filed a motion to strike the declarations of Jillian M.
Hinman and Dan Reist, and any reference to those affidavits contained in the Defendant's
motion for summary judgment. This Court will discuss each of these motions in turn.

1

There seems to be some confusion in Metropolitan’s briefing about the claims for which
Robert Hilborn is seeking summary judgment. Metropolitan mentions both the bad faith claim
and the contract claim, however, in his briefing Robert Hilborn only requests summary judgment
on the contract claim, and there is no mention of the bad faith claim anywhere in his briefing.
Accordingly, the Court will only address the contract claim.

MEMORANDUM DECISION AND ORDER - 3

ANALYSIS
1.

Summary Judgment Legal Standard
Summary judgment is appropriate where a party can show that, as to any claim or

defense, “there is no genuine dispute as to any material fact and the movant is entitled to
judgment as a matter of law.” Fed. R. Civ. P. 56(a). One of the principal purposes of the
summary judgment “is to isolate and dispose of factually unsupported claims . . . .”
Celotex Corp. v. Catrett, 477 U.S. 317, 323-24 (1986). It is “not a disfavored procedural
shortcut,” but is instead the “principal tool[ ] by which factually insufficient claims or
defenses [can] be isolated and prevented from going to trial with the attendant
unwarranted consumption of public and private resources.” Id. at 327. “[T]he mere
existence of some alleged factual dispute between the parties will not defeat an otherwise
properly supported motion for summary judgment.” Anderson v. Liberty Lobby, Inc., 477
U.S. 242, 247-48 (1986). There must be a genuine dispute as to any material fact – a fact
“that may affect the outcome of the case.” Id. at 248.
The evidence must be viewed in the light most favorable to the non-moving party,
and the Court must not make credibility findings. Id. at 255. Direct testimony of the
non-movant must be believed, however implausible. Leslie v. Grupo ICA, 198 F.3d
1152, 1159 (9th Cir. 1999). On the other hand, the Court is not required to adopt
unreasonable inferences from circumstantial evidence. McLaughlin v. Liu, 849 F.2d
1205, 1208 (9th Cir. 1988).

MEMORANDUM DECISION AND ORDER - 4

When cross-motions for summary judgment are filed, the Court must
independently search the record for factual disputes. Fair Housing Council of Riverside
County, Inc. v. Riverside Two, 249 F.3d 1132, 1136 (9th Cir. 2001). The filing of crossmotions for summary judgment – where both parties essentially assert that there are no
material factual disputes – does not vitiate the court’s responsibility to determine whether
disputes as to material fact are present. Id.
The moving party bears the initial burden of demonstrating the absence of a
genuine dispute as to material fact. Devereaux v. Abbey, 263 F.3d 1070, 1076 (9th Cir.
2001)(en banc). To carry this burden, the moving party need not introduce any
affirmative evidence (such as affidavits or deposition excerpts) but may simply point out
the absence of evidence to support the nonmoving party’s case. Fairbank v. Wunderman
Cato Johnson, 212 F.3d 528, 532 (9th Cir.2000).
This shifts the burden to the non-moving party to produce evidence sufficient to
support a jury verdict in her favor. Deveraux, 263 F.3d at 1076. The non-moving party
must go beyond the pleadings and show “by her [ ] affidavits, or by the depositions,
answers to interrogatories, or admissions on file” that a genuine dispute of material fact
exists. Celotex, 477 U.S. at 324.
2.

Plaintiff’s Motion for Partial Summary Judgment
In their Complaint, both plaintiffs allege breach of contract. They allege that

Metropolitan breached the insurance contract by failing to pay benefits under the
contract. Robert Hilborn now asks for summary judgment on his breach of contract

MEMORANDUM DECISION AND ORDER - 5

claim. He contends that under Idaho law, he is entitled to summary judgment because
Metropolitan denied coverage based solely on alleged acts of his co-insured.
Metropolitan counters that two questions of fact prevent summary judgment: (1)
whether Robert Hilborn was involved in making material misrepresentations on the
insurance claim form; and (2) whether Robert Hilborn was involved in a conspiracy to
commit arson (i.e., that he played a role in burning down his house in order to obtain the
insurance money). If material questions of fact remain on either issue, the Court must
deny summary judgment.
A.

Material Misrepresentations

In order to prevail on his breach of contract claim, Mr. Hilborn must prove: (1) the
existence of the contract; (2) breach of the contract; (3) that the breach caused damages;
and (4) the amount of those damages. Mosell Equities, LLC v. Berryhill & Co., Inc., 154
Idaho 269, 278, 297 P.3d 232, 241 (2013).
Here, there is a valid contract because it is not disputed that homeowner insurance
policy number 737385735-1 was in effect at the time of the fire. Thenell Decl. at 1, Dkt.
32-8. As to whether there was a breach of contract, we first look to what the contract
provisions say, and then determine whether those provisions were followed.
The Idaho Supreme Court has stated that “[a]n unambiguous contract will be given
its plain meaning.” Bakker v. Thunder Spring-Wareham, LLC, 141 Idaho 185, 190
(2005). In this case, neither side argues that the insurance contract is ambiguous, nor is
there any dispute as to its content. The contract clearly states that the Hilborns’ personal

MEMORANDUM DECISION AND ORDER - 6

property will be covered in the event of a fire. Thenell Decl. at 3, Dkt. 32-8. However, the
contract also states that
[i]f any . . . [policy holder] conceals or misrepresents any material fact or
circumstance or makes any material false statement or engages in fraudulent
conduct affecting any matter relating to this insurance or any loss for which
coverage is sought, whether before or after a loss, no coverage is provided under
this policy . . .
Id. This means that if Metropolitan can prove that Mr. Hilborn made any material
misrepresentations in regard to the insurance contract, Mr. Hilborn will not be able to
recover on the claim.
Here, Metropolitan alleges just that. In support of its argument, Metropolitan
makes a three-fold argument. Metropolitan argues: (1) Robert Hilborn testified that he
assisted in the creation of the inventory for the personal items lost; (2) Robert Hilborn
testified that he believed that he reviewed the inventory prior to its submission to
Metropolitan; and (3) there were a number of items claimed on the loss inventory form
that were not found in the remains of the house, as well a lawn mower which was claimed
as a loss but that the investigators found undamaged.
These allegations, if true, implicate Mr. Hilborn in the alleged fraudulent
misrepresentations. Moreover, the question of whether Mr. Hilborn was involved in
making material misrepresentations is a material fact to this case because, if proven, it
would affect the ultimate outcome of whether the contract was breached. If a jury
concludes that Mr. Hilborn intentionally and materially misrepresented the value of what
was destroyed in the fire (or listed items that were not destroyed), Mr. Hilborn could not

MEMORANDUM DECISION AND ORDER - 7

recover on the claim. Construing the evidence in the light most favorably to
Metropolitan, the Court must therefore deny summary judgment.
B.

Conspiracy to Commit Arson

Because the Court has determined that a question of material fact remains as to
whether Mr. Hilborn made material misrepresentations, the Court need not address the
conspiracy to commit arson argument.
2.

Plaintiff’s Motion to Strike
Because the Court did not rely on any of the information subject to the Motion to

Strike in making its determination on the Motion for Partial Summary Judgment, the
Court will deem moot the Motion to Strike.
3.

Documents Claimed as Privileged
The Court has reviewed the documents Metropolitan submitted to the Court for in

camera review pursuant to the Court’s earlier Order (Dkt. 50). The Court has determined
that the documents, as itemized in Metropolitan’s privilege log, are either not privileged
or were not included in the documents submitted to this Court. A chart listing the Court’s
ruling is attached as Exhibit A. Accordingly, Metropolitan must provide the Hilborns
with the documents.
ORDER
IT IS ORDERED:
1.

Plaintiff’s Motion for Partial Summary Judgment (Dkt. 47) is DENIED.

2.

Plaintiff’s Motion to Strike (Dkt. 40) is DEEMED MOOT.

MEMORANDUM DECISION AND ORDER - 8

3.

Defendant shall provide the Hilborns with all the documents listed in the
privilege log submitted to this Court.

DATED: March 27, 2014

_________________________
B. Lynn Winmill
Chief Judge
United States District Court

MEMORANDUM DECISION AND ORDER - 9

Exhibit A

Bates No.

Alleged Privilege

Court's Determination

DEF 26(a)(1)_000706

Attorney/Client

Not privileged

DEF 26(a)(1)_000708

Attorney/Client

Not Privileged

DEF 26(a)(1)_000709

Attorney/Client

Not Privileged

DEF 26(a)(1)_000718

Attorney/Client

Not Privileged

DEF 26(a)(1)_000729

Attorney/Client

Not Privileged

DEF 26(a)(1)_000730

Attorney/Client

Not Privileged

DEF 26(a)(1)_000732

Attorney/Client

Not Privileged

DEF 26(a)(1)_000733

Attorney/Client

Not Privileged

DEF 26(a)(1)_000734

Attorney/Client

Not Privileged

DEF 26(a)(1)_000735

Attorney/Client

Not Privileged

DEF 26(a)(1)_000736

Attorney/Client

Not Privileged

DEF 26(a)(1)_000737

Attorney/Client

Not Privileged

DEF 26(a)(1)_000738

Attorney/Client

Not Privileged

DEF 26(a)(1)_000739

Attorney/Client

Not Privileged

DEF 26(a)(1)_000740

Attorney/Client

Not Privileged

MEMORANDUM DECISION AND ORDER - 10

DEF 26(a)(1)_000741

Attorney/Client

Not Privileged

DEF 26(a)(1)_000742

Attorney/Client

Not Privileged

DEF 26(a)(1)_000743

Attorney/Client

Not Privileged

DEF 26(a)(1)_000744

Attorney/Client

Not Privileged

DEF 26(a)(1)_000745

Attorney/Client

Not Privileged

DEF 26(a)(1)_000746

Attorney/Client

Not Privileged

DEF 26(a)(1)_002680-DEF

Attorney/Client

Documents not included

Redacted client email

Documents not included

26(a)(1)_002748
DEF 26(a)(1)_002759-DEF
26(a)(1)_002809
Claim File 000354-Claim File

addresses
Attorney/Client

Not privileged

Attorney/Client

Documents not included

DEF 26(a)(1)_002937

Attorney/Client

Not Privileged

DEF 26(a)(1)_002937

Attorney/Client

Not Privileged

000365
DEF 26(a)(1)_002810-DEF
26(a)(1)_002926

MEMORANDUM DECISION AND ORDER - 11